2.6 Provisions, contingent liabilities and contingent assets

Provisions are recognised when the Company has a present obligation (legal or constructive) as a result of a past event and it is
probable that an outflow of resources, that can be reliably estimated, will be required to settle such an obligation.

If the effect of the time value of money is material, provisions are determined by discounting the expected future cash flows to net
present value using an appropriate pre-tax discount rate that reflects current market assessments of the time value of money and,
where appropriate, the risks specific to the liability. Unwinding of the discount is recognised in the Statement of Profit and Loss as
a finance cost. Provisions are reviewed at each reporting date and are adjusted to reflect the current best estimate.

A present obligation that arises from past events where it is either not probable that an outflow of resources will be required to settle
or a reliable estimate of the amount cannot be made, is disclosed as a contingent liability. Contingent liabilities are also disclosed
when there is a possible obligation arising from past events, the existence of which will be confirmed only by the occurrence or non
-occurrence of one or more uncertain future events not wholly within the control of the Company.

Claims against the Company where the possibility of any outflow of resources in settlement is remote, are not disclosed as
contingent liabilities.

Contingent assets are not recognised in financial statements since this may result in the recognition of income that may never
be realised. However, when the realisation of income is virtually certain, then the related asset is not a contingent asset and is
recognised.

2.7 Earning per share

Basic earning per share is calculated by dividing the net profit or loss for the year attributable to the equity shareholders (after
deducting preference dividends and attributable taxes) by the weighted average number of equity shares outstanding during the
year.

For the purpose of calculating the diluted earnings per share, the net profit or loss for the period attributable to equity shareholders
and the weighted average number of shares outstanding during the period are adjusted for the effects of all dilutive potential equity
shares. The dilutive potential equity shares are deemed converted as at beginning of the period, unless they have been issued at
a later date.

2.8 Employee benefits
Defined contribution plans -

Company's contribution paid / payable during the year to Provident Fund & Employees State Insurance are recognized in the
Statement of Profit & Loss. Provident Fund & Employees State Insurance contributions are made to a government administered
Provident Fund & Employees State Insurance Corporation towards which the company has no further obligation beyond its monthly
contribution. The contributions are recognized as employee benefit expenses when they are due.

Defined benefit plans -
Gratuity

For Agra, Jaipur and Lucknow units, the Company makes annual contributions to gratuity funds administered by the trustees for
amounts notified by the funds. However, for Khajuraho unit, gratuity is unfunded. The Gratuity plan provides for lump sum payment
to vested employees on retirement, death or termination of employment of an amount based on the respective employee's last
drawn salary and tenure of employment. The Company accounts for the net present value of its obligations for gratuity benefits,
based on an independent actuarial valuation, determined on the basis of the projected unit credit method, carried out as at the
Balance Sheet date. The obligation determined as aforesaid less the fair value of the plan assets is reported as a liability or assets
as of the reporting date. Actuarial gains and losses are recognised immediately in the Other Comprehensive Income and reflected
in retained earnings and will not be reclassified to the Statement of Profit and Loss.

Leave Encashment

The liability of accumulating compensated absences is determined by actuarial valuation performed by an independent actuary at
each balance sheet date using projected unit credit method.

3.0 Cash and cash equivalents

Cash and cash equivalents in the Balance Sheet comprise cash at bank and in hand and short-term deposits with banks that are
readily convertible into cash which are subject to insignificant risk of changes in value and are held for the purpose of meeting
short-term cash commitments.

(iii) The Company's Authorised Capital comprises of two class of shares. The Equity shares have a par value of Rs. 10 each and
Preference Shares have a par value of Rs. 100 each.

(iv) The Company has at present issued one class of shares i.e, Equity Shares. Each shareholder is eligible to one vote per
share held and is entitled to dividend on approval by shareholders. The Company declares and pays dividend in Indian
Rupees. In the event of liquidation, the holders of equity shares will be entitled to receive remaining assets of the company
after distribution of all preferential amounts. The distribution will be in proportion to the number of equity shares held by the
shareholder.

(v) During the last 5 years immediately preeceding the balance sheet date, no equity shares has been issed pursuant to any
contract without payment being received in cash. Further the company has neither allotted any shares by way of bonus
shares, not it has bought back any shares during the aforesaid period of 5 years.

(vi) No shares have been forfeited by the company during the year.

(vii) Shareholding of promoters is as under :-

- Appeals against orders raising demands of Rs.459.17 Lakhs are pending with Appellate Authorities under GST Act. Liabilities,
if any, against these demands will be accounted for on finalization of appeals.

- Some employees have filed claims in various courts/ legal forums against suspension/termination etc. and have sought
relief. The ultimate liability, if any, with respect to these claims, is currently not ascertainable and in the opinion of the
management, would not have material effect on the financial statements. One consumer forum matter involving demand of
Rs.3.20 lakh related to Khajuraho unit is going on.

- The company had a property in Agra i.e. property no. 53A at Taj Road, adjacent to the present hotel property. The lease term
of property no. 53A (land area 1.79 acres) expired on 15.05.2021. The company never came in physical possession of this
property even after its purchase and it is physically occupied by the Army for which the company was -getting minor rent of
Rs. 131/- per month. Even that minor rent was stopped after the lease period of 90 years expired. After that, the company
got notice from Union of India-Defense Estate Officers (‘DEO') claiming damages of Rs. 118.09 lakhs from the company. As
the company was neither getting any financial benefit from this property nor lease was being extended and the property was
unproductive, during the financial year ending March 31,2025, the company protested the claim of damages and offered to
surrender the lease and property to DEO. The approval from the Office of the DEO for abolition of damages and surrender
of lease and property is pending. Such demand notices were issued by DEO to several other persons/entities against which
such persons/entities filed Writ Petitions in the High Court of Judicature at Allahabad. The High Court has quashed the
demand notices issued by DEO vide its order dated 15.05.2025.

- Due to Minimum Public Shareholding (MPS') non-compliance, BSE Limited is levying fine on the company on quarterly rests
since second quarter of financial year 2023-24. During the period under review, BSE has levied fine of Rs. 10.74 lakhs and
Rs.10.86 lakhs for the first and second quarter respectively. However, no intimation on levy of penalty for the third and fourth
quarters have been received from BSE Limited (cumulative fine levied till 31.03.2026- Rs. 95.70 lakhs including GST. The
company has requested BSE Limited for waiving off above fine which is pending (Also refer Note No. 39(2) below).

b. Commitments:

Estimated amount of contracts remaining to be executed on capital account and not provided for (as certified by the
Management) Rs. NIL (2025 - Rs. Nil).

27 Debit and credit balances of parties in the financial statements are unconfirmed.

28 In the opinion of the Board, the assets of the Company, except stated otherwise, have a value on realization in the ordinary course
of business at least equal to the amount at which they are stated. All known liabilities are accounted for and all contingent liabilities
are stated.

32. Employees Benefits32.1 Defined Contribution Plans.

A sum of Rs. 151.67 Lakhs (2025 - Rs. 136.84 lakhs) on account of Provident Fund, and a sum of Rs. 35.99 Lakhs (2025 -
Rs. 34.30 lakhs) on account of Employees State Insurance contribution is charged to revenue during the year.

Notes

1. In respect of funded gratuity plans, the year-end fund statement / valuation from LIC was not available as at the date of
approval of these financial statements due to system migration activities at LIC. Accordingly, the gratuity liability and related
plan assets have been accounted for based on the actuarial valuation carried out by an independent actuary and management's
assessment of the fund balance.

2. The Government of India notified four Labour Codes, namely the Code on Wages, 2019, Industrial Relations Code, 2020, Code
on Social Security, 2020 and Occupational Safety, Health and Working Conditions Code, 2020, effective from 21 November
2025. During the year, based on the actuarial valuation carried out considering the available provisions of the aforesaid Codes
and related developments, the Company has recognized the impact, wherever ascertainable, in employee benefit expenses.
However, the detailed rules, procedures and state-specific implementation mechanisms are yet to be fully notified / implemented.
The Company shall continue to evaluate the impact of the aforesaid Codes and recognize consequential effects, if any, in the
period in which the relevant rules and implementation provisions become effective.

33. Impairment

It is the view of the management that there are no impairment conditions that exist as on 31st March, 2026. Hence, no provision is
required in the accounts for the year under review.

39.1 The Company had taken corporate steps for compliance with Minimum Public Shareholding (“MPS”) requirement, by passing
a board resolution dated 27.05.2013 and shareholders' resolution dated 23.07.2013 for issuance of Bonus Shares to the public
shareholders. After the Extra-Ordinary General meeting held on 23.07.2013, the bonus shares could not be issued to the public
shareholders as 62.5% of promoter shareholders did not relinquish their right to Bonus shares and thus could not maintain/comply
with the MPS requirement. The said board resolution and the shareholders' resolution are also subject to status quo order dated
20.03.2013 in a civil suit filed before a Civil Court at Lucknow bearing Regular Suit No. 1574 of 2012, titled Birendra Kumar & Ors.
Vs. Sushil Kumar & Ors. (“Civil Suit”). The said Civil Suit is filed by three members of the promoter group family against other family
members wherein the Company is also a party to the same. The suit is presently pending adjudication.

39.2 Due to MPS non-compliance, Securities & Exchange Board of India (SEBI) vide its orders dated 04.06.2013 and 02.12.2014 has
inter alia directed freezing of voting rights and corporate benefits with respect to excess of proportionate promoter/promoter group
shareholding and issued other directions against the promoter shareholders and directors. To comply with the MPS norm, the
company initiated voluntary delisting process in year 2022. However, delisting was unsuccessful. The Company had again applied
to SEBI for allowing the company to go for voluntary delisting process. SEBI vide its letter dated 03.12.2024 allowed the company
for voluntary delisting. The company initiated the process of voluntary delisting. However, the special resolution was not passed by
the shareholders. The company had to complete the delisting process within 1 year from the date of the issuance of SEBI Letter i.e.
03.12.2024. The said time period expired on 02.12.2025. The company has filed application with SEBI, seeking extension of time
to complete the voluntary delisting process. In addition, due to MPS non-compliance, BSE Limited is levying fine on the company
which accumulated to Rs. 95.70 lakhs till 31.03.2026. The company's request to BSE Limited to waive off above fine is pending with
BSE. The above non-compliance has the effect of promoters, promoter group and directors of the company becoming ineligible to
hold any new position as director in any other listed entity till the date of compliance by the company. An intimation to this effect shall
be provided to the company by BSE and the company shall subsequently intimate the same to its of promoters, promoter group and
directors. (Also refer footnote to Note no. 26(a) on Contingent Liabilities)

40 Both the Joint Managing Directors had raised concerns regarding working of hotels, certain/various aspects of management. One
of the Joint Managing Directors filed a petition on 15.05.2015 before the Company Law Board (now the National Company Law
Tribunal), New Delhi titled as Rupak Gupta & Anr. Vs. UPHL & Ors. against the Company and others under Sections 397/398,
402, 403 and 237 of the Companies Act, 1956 and Section 219 & Section 220 of the Companies Act, 2013 for oppression and
mismanagement. The other Joint Managing Director has filed a reply to the petition on 09.05.2016 on behalf of the respondents -
himself and has contested the Petition and denied all the allegations. The Petition is currently pending adjudication. A Management
Representation has been given to the Auditors in this matter.

41 The company is yet to comply with the followings:

a) The Company is yet to comply with Regulation 38 of SEBI (Listing Obligations and Disclosures Requirements) Regulations,
2015 with regard to Minimum Public Shareholding (MPS).

b) The Company is yet to achieve 100 percent dematerialization of the promoters' shareholding as required under Regulation
31(2) of SEBI (Listing Obligations and Disclosures Requirements) Regulations, 2015. Due to non-compliance of Minimum
Public Shareholding under Regulation 38 of SEBI LODR Regulations 2015, SEBI vide its Order dated 04.06.2013 and
02.12.2014 has prohibited dealing in the shares of the company by the promoters & promoter group of the company. BSE
Limited pursuant to SEBI Circular dated 17.10.2017, had issued directions to respective Depository Participants to freeze the
De-mat accounts of promoters of U. P. Hotels Limited and accordingly, the De-mat accounts of all the promoters & Promoter
Groups of the company have been frozen in the month of September 2023.

c) Some of the Related Party Transactions (“RPT”) entered into by the company during the previous years and which are
continuing in the current financial year could not be approved by the Audit Committee and Board of Directors, being part of a
legal matter pending before the Hon'ble National Company Law Tribunal (NCLT) for adjudication. The Board of directors in its
meeting on 20.08.2017 decided to defer the matter of RPTs till the final decision of the NCLT. These RPTs are not entered in
the Register maintained under Section 189 of the Companies Act, 2013. As such, the Company is yet to comply with sections
188 and 189 of the Act and Regulation 23 of SEBI (Listing Obligations and Disclosures Requirements) Regulations, 2015.

42 No funds have been advanced or loaned or invested (either from borrowed funds or share premium or any other sources or kind of
funds) by the Company to or in any other person(s) or entity(ies), including foreign entities (“Intermediaries”) with the understanding,
whether recorded in writing or otherwise, that the Intermediary shall lend or invest in party identified by or on behalf of the Company
(Ultimate Beneficiaries). The Company has not received any fund from any party(s) (Funding Party) with the understanding that the
Company shall whether, directly or indirectly lend or invest in other persons or entities identified by or on behalf of the Company
(“Ultimate Beneficiaries”) or provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries.

43. Amounts are given in lakhs except stated otherwise. Previous year's figures have been regrouped / reclassified wherever necessary
to conform to this year's classification.